There has been a notable surge in the demand for flexible or serviced office spaces on short leases as businesses adopt hybrid working following COVID-19, according to Thursfields Solicitors.
Tony Gibb, a director at Thursfields and head of the commercial property team, was commenting after a Centre for Cities think tank report suggested that a blend of home and office working is expected to be popular while the UK recovers from the pandemic.
Some analysts then anticipate that a shift back to pre-Covid working patterns of the five-day office week could become the norm again within two years.
Tony said: “If this becomes a reality in the coming months, it means that the demand for office space will be on the increase again.
“During the pandemic and the lockdown that followed, many businesses reviewed and even gave up their office leases, which prompted a lot of discussions about the future of office spaces.
“But office space demands have risen since the slow unlocking of the nation, shown by significant increases in office space take-up in the UK’s six biggest regional cities – Birmingham, Bristol, Edinburgh, Glasgow, Leeds and Manchester – in figures collated by Savills estate agents.
“There is also now an unprecedented demand for flexible or serviced office spaces on short leases as some businesses adopt hybrid working.
“Whilst they want the spaces to be flexible, most firms still want a five-day office. This does not mean that office spaces are necessarily cheaper as the flexibility that businesses are demanding is priced into the cost of the lease.
“For our landlord clients, this means that they need to be willing to enter into more flexible leases depending on the different needs and requests of the prospective business tenants.
“This will reflect the tenant’s requirement for shorter term contracts, more flexible space, and better assignment terms in their leases.
“As solicitors, we also have to ensure that there are sufficient clauses that protect the rights of our landlord clients even in shorter, more flexible leases.”
Tony added: “For those tenant clients, our role is to negotiate leases that take account of all their needs for flexibility, whether in terms of the arrangement of the space, and provision for early termination of the lease.”